Means test checklist

The following is a checklist that a bankruptcy attorney might use (including of all the items within each of the six steps in the means test and the credit counseling requirement).

Step 1: Determine the debtor's CMI

_____ Received check stubs for the six-month period before filing.
_____ Calculated total gross income (use six months of pay stubs).
_____ Divided total gross income by 6.
_____ All income sources included.
_____ Social Security, unemployment and tax refunds excluded.
_____ If a joint case, joint debtor’s pay stubs received for 6-month period before filing.
_____ Debtor’s spouse's income verified (not joined in petition).
_____ Multiply CMI by 12 to reach ACMI.
_____ Find the applicable "median family income" amount.
_____ Compare debtor's ACMI with the applicable median family income.
_____ If income is less, proceed to file Chapter 7.
_____ If income is more, proceed with means-test calculation.

Step 2: Determine necessary expenses

_____ Locate the applicable National Standards (i.e., one-, two-, three-, or four-person).
_____ If more than four people in the debtor's household, add the per-person addition to the appropriate number in the four-person table.
_____ Locate the applicable Local Standards table from the U.S. Trustee’s website. Look for the state and county closest to the debtor’s residence.
_____ Find the applicable housing and utility cost for the debtor.
_____ Calculate debtor's housing and utility costs pursuant to the table.
_____ Deduct mortgage payment from housing costs.
_____ Deduct any liens placed of debtor's property (second mortgage).
_____ Find the applicable transportation cost for the debtor.
_____ One or two vehicles?
_____ Calculate debtor’s transportation costs.
_____ Do not include the car payment from transportation costs.
_____ Calculate vehicle ownership costs.
_____ Deduct car payment from ownership costs.
_____ Do not insert any negative numbers.
_____ Calculate any taxes due.
_____ Calculate any insurance premiums. Do not include homeowners, auto, renters, or whole life.
_____ Calculate court-ordered payments.
_____ Any expenses for healthcare?
_____ Any expenses for child care?
_____ Any expenses for debtor to produce an income?
_____ Total all necessary expenses.

Step 3: Determine additional expenses

_____ Calculate 5% of living expenses in the National Standard.
_____ Include documentation of necessary living expenses in excess of National Standard.
_____ Calculate health insurance, disability insurance and health savings account.
_____ Calculate expenses for elderly, ill or disabled family member.
_____ Calculate monthly educational expenses for minor children (cannot exceed $125 per child per month).
_____ Multiply monthly educational expense by the number of minor children.
_____ Calculate home energy expenses in excess of IRS Local Standards.
_____ Obtain copy of debtor's monthly energy bills to support expense.
_____ Deduct Local Standard energy allowance from total energy expenses.
_____ Calculate excess energy expenses.
_____ Calculate total additional expenses.

Step 4: Determine secured monthly expenses

_____ Obtain total of all secured debts and priority claims (mortgage, car payment, domestic support).
_____ Debtor in arrears on any secured debt (mortgage, car payment, domestic support)?
_____ Determine total of all arrearages and add to gross total.
_____ Determine gross total for 60 months by examining the terms of the debts.
_____ Divide the gross total by 60.
_____ Total is debtor's monthly payment for secured debts.
_____ Determine trustees fees for debtor's area if Chapter 13.
_____ Add to debtor's monthly payment for secured debts.

Step 5: Determine net CMI

_____ Add necessary expenses, additional expenses, and secured debt expenses to arrive at the total expense deduction.
_____ Subtract the expense deduction from the CMI calculated in Step 1.
_____ Total is the debtor's net CMI.

Step 6: Determine if a presumption of abuse exists

_____ If debtor's monthly net CMI is less than $109.58, no presumption of abuse exists.
_____ If debtor's monthly net CMI is $182.50 or more, a presumption of abuse exists. May file or convert under Chapter 13.
_____ If debtor's net CMI is between $109.58 and $182.50, calculate the total of debtor's unsecured debts.
_____ Divide the total unsecured debts by 60.
_____ Is debtor's net CMI enough to pay 25 percent of the unsecured debts?
_____ If no, there is no presumption of abuse.
_____ If yes, a presumption of abuse exists.

Credit counseling

_____ Did debtor attend a pre-petition counseling session?
_____ Is counseling program approved by the U.S. Trustee?
_____ Get list of approved programs from clerk of the Bankruptcy court.
_____ Obtain certificate of completion from debtor.
_____ Obtain plan of repayments of debts, if any.
_____ File certificate and plan with court.
_____ Did debtor attend a pre-discharge financial management class?
_____ Class approved by the U.S. Trustee?
_____ Obtain certificate of completion from debtor.
_____ File certificate of completion with the court at least ten days prior to discharge or within 60 days of the meeting of creditors.

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